Idaho's Economic Diversity

Hispanics and Native Americans fuel the state's economy

Shoshone-Bannock TribesFort Hall Business Council members and other dignitaries at the ribbon cutting of Shoshone-Bannock Tribes' new travel center and casino in Sage Hill, near Blackfoot.

The economic influence of Idaho's five Native American tribes and of the state's growing Hispanic population is larger than previously thought, according to two recent reports.

Findings of a recent study by the Idaho Department of Labor show that while the buying power of all 1.5 million Idahoans increased only a half percent from 2008, the recession did not stop the growth of Hispanics' economic influence [pdf]. In fact, Hispanic buying power grew 10 times faster than the buying power of the state's non-Hispanic majority, helping sustain the state's overall economy.

Buying power is the personal income people have left after taxes. This income covers necessities, such as food, clothing and housing but also luxuries. It is the money that feeds the local economy.

In 2009, the buying power of Idaho's Hispanic population rose 3.1 percent compared to a growth of .3 percent for the non-Hispanic population.

"We're really pleased the IDL is releasing this report, but its findings are not surprising to us," said Margie Gonzalez, executive director of the Idaho Commission on Hispanic Affairs. "We've been watching our population grow for years."

Gonzalez said that there is a lot of stigma around what the Hispanic population gives back to the state.

"This report serves as an educational tool to show how our population gives back to the state economically," she said.

In the last 20 years, the Hispanic share of Idaho's total buying power has doubled from 2.8 percent to 5.7 percent. The increase is primarily the result of a growing Hispanic population, the Department of Labor reports.

"Increase in population growth naturally leads to a greater buying power. But it's increasing faster than non-Hispanic buying power, which means the gap between Hispanic and non-Hispanic buying power is closing," said Bob Fick from the Idaho Department of Labor. "And closing the gap is good for everyone."

Fick said that assimilation into the Idaho economy is slowly improving the economic standing of the Hispanic population.

"While everyone was hit by the recession, there has been an influx of the Hispanic population becoming economically acclimated and their businesses have been able to survive and suffer less than non-Hispanic businesses," he said.

Fick pointed out that while the increase in Hispanic buying power is significant as a percentage, there's still a large gap between the dollar amount behind these percentages. Non-Hispanic buying power last year was $130 million in contrast to $75 million for the Hispanic population.

"For several decades, the five tribes have been significant forces for Idaho," said Steven Peterson, U of I research economist and instructor. "They have their own sovereign states with their own governments, health systems, fish and wildlife protection, hospitality industry, businesses and casinos. They employ 10,516 Idaho residents."

The tribes commissioned Peterson to conduct an economic impact study for each tribe and then to compile the results into a statewide study, which will be available as a full report later this spring. The preliminary results were released last week in Moscow.

The study looked at the direct spending, employment and revenues generated by the tribes, as well as the multiplier effect of those dollars turning over in the local economies.

According to the study, the five tribes are responsible for $488 million, or roughly 1 percent of Idaho's gross state product.

While gaming is a driving force behind the tribes' economic growth, other substantial contributors to tribal economies are tribal government, reservation farming, federal programs serving tribes and other tribal businesses.

The tribes play an especially significant role in diversification of rural economies, where jobs are often limited to one industry, Peterson explained.

"The five tribes and their reservations offer another source of jobs and industries to the area, which are fairly stable avenues of economic activity," he said.

Peterson has spent the last 15 years working with Idaho's tribes, but this is the first study of its kind with the full participation of all five tribes: the Kootenai, Coeur d'Alene, Nez Perce, Shoshone-Bannock and Shoshone-Paiute.

If the five tribes' economies combined were one Idaho county, the tribes would rank 23rd out of the 44 Idaho counties in economic activity, Peterson said.

In total, the tribes directly employ 4,043 employees, collectively making them one of the top 10 employers in Idaho.

"Economically, the five tribes have been largely and historically invisible," Peterson said. "Despite the fact that in some regions they are the No. 1, No. 2 employer."

Studies like these--both the IDL and U of I report--confirm that minorities in Idaho are rapidly growing, significant economic engines in the state that continue to generate business opportunities across the board, Peterson said.

"Diversity is an important component of the state's economy," he said. "The greater the diversity, the more favorable it is for outside entrepreneurs to come in."

CORRECTION: The change in non-Hispanic buying power last year was $130 million in contrast to $75 million for the Hispanic population. The actual buying power for both groups is in the billions.